Leaving

You can leave the Local Government Pension Scheme (LGPS) at any time by giving your employer notice in writing. You might, however, want to take independent financial advice before making the final choice to opt-out. Don’t forget you can join the 50/50 section instead, which allows you to stay in the LGPS and still build up valuable pension benefits, but pay half your normal contributions for half your normal pension.

Opting out before three months

If you opt-out within three months of joining, you’ll be treated as if you’d never been a member. Your employer will refund any contributions you have made during that time in your pay, even if you have deferred LGPS benefits or you are receiving an LGPS pension already.

Opting out with less than two years’ membership

If you opt-out with three or more months’ membership but less than two years, you will have different options:

• You can take a refund of your contributions less 20% tax.
• You can transfer your pension to another qualifying pension scheme.
• If you were in the LGPS before 1 April 2014, you can choose to leave your benefits in the LGPS (they will then be ‘deferred’),

You must take a refund or transfer within five years of opting out, or when you reach age 75, if earlier.

However, please note that a refund will not be available if you already have deferred LGPS benefits or an LGPS pension in payment. You will be treated the same as a member who opts out after more than two years – see the next section.

If you’re planning to transfer, you should also contact your new pension fund to see if there are any time limits.

Opting out after more than two years

If you opt-out after two years, you’ll have deferred benefits in the LGPS. You cannot take your deferred pension until you have left your job, or reach age 75, if earlier.

You can transfer these benefits out to another scheme if you want to.

You can opt back into the LGPS at any time before age 75, as long as you still qualify for membership.

However, if you opt-out with a deferred pension you will not be able to join up your benefits if you re-join.

Your employer may enrol you back into the LGPS automatically at certain times. They must let you know if this happens. You can opt-out again.

Leaving your job

If you leave the LGPS because you’re leaving your job, you will broadly have the same choices as if you’d opted out, depending on your time in the LGPS.

If you are due to receive a refund of contributions, you can delay taking it for five years, or until you reach age 75, if earlier.

These are benefits you still have in the LGPS after opting out or leaving.

Find out how we work out your deferred benefits here [link to ‘How we work out your pension’].

• Your deferred pension will be adjusted each April in line with the cost of living. If you die as a deferred member, a death grant will generally be payable, and your partner and children may also receive dependants’ pensions.
• Your deferred pension will stay in the LGPS until you either:
  • choose to start receiving it. You can generally choose to take your deferred pension any time between age 55 and 75. If you are too ill to work, you may be able to take it sooner. See the Taking my benefits page for more details about your deferred pension options.
    
    Or

• you transfer your deferred benefits to another pension arrangement. See Transferring out to find out more about pension transfers.

Special rules apply if

• you have more than one job in the LGPS; or
• your job is transferred to a private contractor.

Option to take more cash

You may have the option to exchange some of your pension for an increase to your tax-free lump sum.

Visit the Contact details page if you have any questions on retirement or taking your benefits.